The federal minimum wage right now is $7.25. For someone working full-time, that translates to $15,060 per year, just barely over the national poverty line. This week, we’re taking a closer look at the history of minimum wage, exactly who is making it, and dispelling some misinformation.
In 2023, almost a million hourly workers in the United States made minimum wage or less. And contrary to popular belief, they’re not all teenagers — many are moms earning half of their family’s total income. They’re working jobs you might expect, like retail and food service, but also jobs you might not have expected, like home healthcare workers.
And here’s something important to know: the minimum wage doesn’t automatically increase with inflation. It has to be intentionally raised by Congress, something that hasn’t happened since 2009. Think about how much prices have gone up since then! The average rent has literally doubled, not to mention how expensive groceries, gas, and childcare have gotten. And yet, through all that, minimum wage has remained the same. In 1974, the minimum wage was $2 per hour. If it kept up with inflation, it would be $12 today. If we instead matched it to worker productivity– how much value we’re generating per hour of work – it would be almost $26 an hour. Just imagine how that would change people’s lives.
But would it be bad for business? Honestly, it’s really complicated and you can find economists and real-world examples arguing both sides. But either way, we have to do something. The United States has one of the worst wealth inequalities in the world, and it’s only been getting worse since the pandemic. It’s hard to even wrap your mind around just how much money is in the hands of the richest few. Elon Musk is currently worth $420 billion – a person earning minimum wage would have to work nonstop for almost 7 million years to earn that much money.
We need to push our politicians to do something, whether it’s a higher minimum wage, better social programs, higher taxes for billionaires, or some combination. The ultra-rich are already looking out for themselves – in fact, the amount of money that billionaires are spending on politics has skyrocketed in the past few years. No wonder Trump’s “big beautiful bill” includes massive tax cuts for the rich!
It doesn’t have to be this way. If we look at other countries around the world, or even America a few decades ago, we can see that wealth inequality has never been this bad. It’s not a fact of life; it’s not a necessary evil to have a good economy. It can change if we all talk to our friends and neighbors… and vote accordingly.
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